It's shaping up to be a tough period for Crystal Clear Electronic Material Co.,Ltd (SZSE:300655), which a week ago released some disappointing quarterly results that could have a notable impact on how the market views the stock. Results showed a clear earnings miss, with CN¥364m revenue coming in 7.2% lower than what the analystsexpected. Statutory earnings per share (EPS) of CN¥0.01 missed the mark badly, arriving some 73% below what was expected. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.
After the latest results, the four analysts covering Crystal Clear Electronic MaterialLtd are now predicting revenues of CN¥1.58b in 2024. If met, this would reflect a notable 16% improvement in revenue compared to the last 12 months. Earnings are expected to improve, with Crystal Clear Electronic MaterialLtd forecast to report a statutory profit of CN¥0.04 per share. Before this earnings report, the analysts had been forecasting revenues of CN¥1.54b and earnings per share (EPS) of CN¥0.12 in 2024. So it's pretty clear the analysts have mixed opinions on Crystal Clear Electronic MaterialLtd after the latest results; even though they upped their revenue numbers, it came at the cost of a large cut to per-share earnings expectations.
There's been no major changes to the price target of CN¥9.67, suggesting that the impact of higher forecast revenue and lower earnings won't result in a meaningful change to the business' valuation. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. Currently, the most bullish analyst values Crystal Clear Electronic MaterialLtd at CN¥12.00 per share, while the most bearish prices it at CN¥8.00. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Crystal Clear Electronic MaterialLtd shareholders.
Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. The analysts are definitely expecting Crystal Clear Electronic MaterialLtd's growth to accelerate, with the forecast 34% annualised growth to the end of 2024 ranking favourably alongside historical growth of 13% per annum over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 15% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that Crystal Clear Electronic MaterialLtd is expected to grow much faster than its industry.
The Bottom Line
The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Crystal Clear Electronic MaterialLtd. Pleasantly, they also upgraded their revenue estimates, and their forecasts suggest the business is expected to grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.
Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. At Simply Wall St, we have a full range of analyst estimates for Crystal Clear Electronic MaterialLtd going out to 2026, and you can see them free on our platform here..
You still need to take note of risks, for example - Crystal Clear Electronic MaterialLtd has 1 warning sign we think you should be aware of.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.